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Caregivers, Capacity And Conflict, Part 2: Financial Exploitation

In the first part of this post, we began discussing the issue of caregivers and the possibility that they may exercise undue influence on the people they care for.

As we noted, this situation can become especially problematic when the person being cared for has some degree of dementia.

In this part of post, we will wade into these sometimes-murky waters, seeking to identify key principles. Considering these principles should help you and your family face estate-planning issues involving caregivers that may be complicated by cognitive decline.

First of all, keep in mind that "dementia" is by no means a clinical term. There is a wide array of behavior that is loosely lumped together under this catch-all term. It can range from the merely mild - minor metal slips that are normal with advancing age - to outright instances of Alzheimer's disease.

Let's say someone in their 70s or 80s is being taken care of by a non-family caregiver. Eventually, after gaining the trust of the person receiving care, the caregiver persuades him or her to execute a power of attorney to allow the caregiver to manage their money.

In Michigan and across the nation, courts are likely to be suspicious of such an arrangement. The possibilities of financially exploiting a vulnerable adult are very real.

Of course, it is certainly possible that the person receiving care may insist that he or she completely supports the caregiver's financial management. Those cases can be challenging,

They can be challenging because the consent to the arrangement by the vulnerable person may be compromised - not only by their mental condition, but by any undue influence that may have been exerted.

Source: mySA, "Paid Caretaker should not be receiving inheritance," Paul Premack, March 3, 2014

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